Grace Ashiru
TLcom Capital, a venture capital firm based in Nairobi and known for investing in companies like Vendease, Seamless HR, and uLesson, has successfully completed its final fundraising round for TIDE Africa II, achieving a total of $154 million dedicated to early-stage startups. The fund initially secured $70 million in its first close in January 2022, with expectations to reach a second close by the year’s end.
However, the process to fully meet and exceed the funding goal extended over two years. According to Maurizio Caio, the founder and managing partner at TLcom Capital, the delay was due to the reception of significant investments that necessitated adjustments in documentation.
With a total capital of roughly $154 million, TIDE Africa II is about twice the size of TLcom’s inaugural fund, which amassed $71 million and concluded in February 2021.
Venture capital funding in Africa saw a downturn in 2022, continuing into 2023 as the global appetite for venture investments waned. In 2023, African startups secured $3.2 billion in funding, marking the lowest investment level since 2020, which saw $2.1 billion raised. Amidst a significant reduction in foreign capital, marked by the withdrawal of 400 unique investors from the African market, local firms such as TLcom have increased their involvement.
TLcom Capital typically begins investing at the seed or Series A stages, and provides follow-up funding to its portfolio companies as they enter growth phases.
Caio, a representative from TLcom, mentioned, “Our initial investments usually range from $1 to $3 million.”
Furthermore, TLcom Capital is focusing on supporting female-led tech startups. They were one of the initial investors in FirstCheck Africa, a fund dedicated to pre-seed investments in female-founded startups, with a commitment of $2 million since its inception in January 2021.
The company is committed to demonstrating to the global VC market that, over the next three to five years, the African tech ecosystem is capable of yielding significant returns. It plans to invest in 20-25 startups.
“For TIDE Africa Fund II, we are continuing with the same investment approach we used for our initial fund, which directed more than 80% of its investments into Seed or Series A stages,” noted Caio.
The backers of TIDE Africa Fund II include notable entities such as the European Investment Bank (EIB), Allianz, DEG Impact’s joint venture AfricaGrow, Visa Foundation, and Bertelsmann.
The launch of the new fund also marks TLcom’s expansion into Egypt and South Africa, enhancing its ability to collaborate with African entrepreneurs to address some of the most pressing and intricate challenges facing the continent through innovative solutions.
TIDE Africa Fund II has already commenced operations in South Africa and Egypt, investing in companies like LittleFish, a Cape Town-based software firm that develops payment and banking products for SMBs with a retail focus, and ILLA, a Cairo-based company specializing in middle-mile logistics.
